8 ms·

I see the same thing with private enterprise everyday.

• bhupy 6y ago
  Key difference being that there’s actually some mechanism for private enterprises to fail and go out of business.
  • Fricken 6y ago
    Government's can and do fail.
    • bhupy 6y ago
      It's extremely rare. Ask yourself how many companies from the 20th century are now defunct vs government programs (or governments in general). You can probably count on one hand the number of governments that have "gone out of business" (so to speak), in the last 40-50 years. You'll need several people to tabulate the set of private enterprises that have gone bankrupt, defunct, or M&A'd out of existence over the same timespan, in the US alone.
      • dukeyukey 6y ago
        If you count having lost effective control of a significant part of their country as a government having failed, there are plenty. No-one would say that Syria or Libya have a single functioning government controlling the country at the moment, and you can throw swathes of central Africa in there as well. Other than a coup, civil war, or a foreign takeover, there isn't really a way for a government to definitely 'fail', but no-one would say that these events are unheard of.
        • bhupy 6y ago
          > If you count having lost effective control of a significant part of their country as a government having failed, there are plenty. Losing control of a significant part of a country isn't comparable to private enterprise failure, it's more comparable to the CEO of a company being replaced. Imagine what retail would have been like if, instead of Sears being essentially replaced, we just elected a different set of leaders to run the same organization. > No-one would say that Syria or Libya have a single functioning government controlling the country at the moment, and you can throw swathes of central Africa in there as well. Right, and in general we consider that instability to be a bad thing, and a key goal of UNESCO (and adjacent organizations) is to make African nations as stable as Western democracies. That kind of stability just isn't sought out in the private sector. > Other than a coup, civil war, or a foreign takeover, there isn't really a way for a government to definitely 'fail', but no-one would say that these events are unheard of. If you were to ask me to pick a system where change happens through violence and bloodshed (civil wars, coups) vs peaceful financial transactions (M&A, bankruptcy) — I would choose the latter any day of the week.
          • wang_li 6y ago
            An awful lot of this list is less than 100 years old. https://en.m.wikipedia.org/wiki/List_of_national_constitutions https://en.m.wikipedia.org/wiki/List_of_national_constitutio...
            • bhupy 6y ago
              Of the items in that list < 100 years old, the vast majority came about through violence via revolution, civil war, genocide, or regime change. That's a bug, and not a feature. Peaceful restructuring of government is rare, and when it happens, it’s noteworthy. In contrast, peaceful restructuring of private enterprise (via startup incorporation, bankruptcy, or M&A) is just a way of life. People didn't die when PanAm, TWA, and Circuit City went out of business. People didn’t die when GM was restructured.
              • ClumsyPilot 6y ago
                This criticism and comparison is ridiculous, there is no such thing as 'violent restructuring of private enterprise' because companies don't have armies, governments do. And 2008 has killed plenty of people, by rendering them homeless, hungy, and unable to afford healthcare.
                • bhupy 6y ago
                  > This criticism and comparison is ridiculous It's really not. We have more than enough history to corroborate. > And 2008 has killed plenty of people, by rendering them homeless, hungy, and unable to afford healthcare. Right, and these events are rare and noteworthy also — the only other time that had happened before that was during the 1930's. The same cannot be said for structural changes in government. In addition, if you think the scale and severity of economic deaths of despair caused by 2008 can be compared with the civil wars in the Middle East, the Balkan Kosovo War, the World Wars (and Holocaust), or what's going on in Central Africa...I really don't know what to say.
                  • 6y ago
      • wang_li 6y ago
        The last 40-50 years have been pretty stable. But even so I’d guess that 20% of world governments have functionally gone out of business. If you pick the 20th century, then the number of governments that have “failed” is really large as a proportion of total governments. We think of countries like France as having been around for hundreds of years, but their current constitution is only 62 years old. Romania had three different governments in about 50 years. Japan, China, and Vietnam all replaced their governments. Czechoslovakia came into being and disappeared.
      • inglor_cz 6y ago
        Uh, just look at the Arab world. Is the Lebanese government "in business" or no? That is a question with fuzzy answer, but if no government is 0 and competent government is 1, Lebanese government right now may be 0.02 or so. Czechoslovakia, where I was born, disintegrated in 1992. The transition was peaceful, but the federal government simply is no more.
  • netcan 6y ago
    Not really... I mean, in theory, democracy ensures that inefficient leaders lose office, except that reality rarely lives up to theory. IRL, the business models of most major tech companies are pretty impervious to most inefficiency. Most of their leadership is beyond the reach of shareholder discipline too. Monopoly makes a good moat. Banks aren't accountable for their own losses. How many more examples do we need? Large company bankruptcies are a rarity, and when they do happen (eg american airlines) the resulting mess just enforces the bailouts mentality. Dealing with them is an exercise in kafkaesque patience and it is impossible to work out where their mindless bureaucracy starts and regulation begins. In 2020, an anti-bureaucracy worldview that sees the dividing line as public/private is foolishly anachronistic. Sure "some" mechanism exists for them to go out of business. That's about as useful as the ballot for creating efficiency.
    • bhupy 6y ago
      > I mean, in theory, democracy ensures that inefficient leaders lose office, except that reality rarely lives up to theory. It's not just replacing inefficient leaders that's an important mechanism for "efficiency", it's also restructuring organizations. Democracy, at best, just means that you have different leaders, but the mostly the same set of bureaucrats operating the same programs. Private enterprises, on the other hand, allow us to whole-sale replace entire purveyors of goods & services with entirely different structures of organization in a manner that's difficult to reproduce for a monolithic public monopoly. Imagine what retail would have been like if, instead of Sears being essentially replaced, we just elected a different set of leaders to run the same organization. > IRL, the business models of most major tech companies are pretty impervious to most inefficiency. When a business is unable to collect enough money to continue operating, it goes out of business. Almost no major tech company has been able to continue operating without either sustaining themselves, or collecting investment. > Most of their leadership is beyond the reach of shareholder discipline too. Monopoly makes a good moat. Sure, and monopolies are bad for the same reason. But most industries aren't run by monopolies. You only hear about the ones that are, because they're so noteworthy. > Sure "some" mechanism exists for them to go out of business. That's about as useful as the ballot for creating efficiency. I don't think that's true at all. You can count on one hand the government programs that have gone defunct in the last 60 years. The number of private enterprises that have gone bankrupt, defunct, or M&A’d out of existence over the same timespan is almost countless. You're 100% right about the banks and bailouts, though. That's not a private enterprise problem, though — that's a "our government is doing a stupid thing" problem.
  • HarryHirsch 6y ago
    You can vote political parties out of office. Locally, you can vote the corrupt mayor and all his cronies out of office and install a different one.
    • PaulDavisThe1st 6y ago
      That requires (1) the failure to be visible and self-evidently the result of political processes and decisions (2) people to act on (1) and actually vote (3) alternate candidates that have a genuinely different plan. It's not that easy to ensure that all 3 happen.
      • novok 6y ago
        Eventually you need the superstars to do the innovative work. Elon musk & his top employees are not reproducible on demand
        • inglor_cz 6y ago
          No, but it is obvious that Musk could mobilize a lot of talent that might have been spent on less innovative work elsewhere. It is my suspicion that there is actually a lot more talented people than we tend to think and the real problem is educating and managing them well. There is an interesting case of Florence, Italy, which in the 14th and 15th century produced an incredible set of world class painters. That school is unmatched until today. We think that world class painters must be principially very rare, but maybe not so much. In a relatively short span of time, recruiting mostly students from Northern Italy only, the Florence school could produce quite a significant percentage of artistic heritage of the whole humanity.
          • PaulDavisThe1st 6y ago
            I don't understand what a bunch of engineers at one of Musk's companies, or the ease of generating bunch of very good painters in Firenze in the 15/1600s have to do with the problem of improving/fixing city/local governance.
  • rbg246 6y ago
    I understand why you say this, and I used to think that way myself and it makes rational sense when you compare the way government runs when you look at how you most probably work in an efficient team, getting things done etc (or maybe not!) . But.. This seems too simplistic a rule to apply to large and complicated projects which likely are the case with creating and maintaining infrastructure. If private investment can't calculate expected return they don't do it and this often is the case with complicated projects there is often high risk involved and no easily attainable reward (from a financial perspective). This is why public / government undertakes these projects because they know what the expected benefit is to society and are not driven by ROI in the same way as private enterprise. Your model needs to take this into account in order to be more persuasive.
• refurb 6y ago
  Sure, but if they screw up it’s some poor investors money, not my tax money.
  • PaulDavisThe1st 6y ago
    How can that be a useful model for building and maintaining roads, water supplies, sewers and so forth?